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Informational leverage: the problem of noise traders

Author

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  • Norvald Instefjord
  • Kouji Sasaki

Abstract

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Suggested Citation

  • Norvald Instefjord & Kouji Sasaki, 2008. "Informational leverage: the problem of noise traders," Annals of Finance, Springer, vol. 4(4), pages 455-480, October.
    • Handle: RePEc:kap:annfin:v:4:y:2008:i:4:p:455-480
    DOI: 10.1007/s10436-007-0086-y
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    References listed on IDEAS

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    1. Rohit Rahi & José M. Marín, 1999. "Speculative securities," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 14(3), pages 653-668.
    2. Boot, Arnoud W A & Thakor, Anjan V, 1993. "Security Design," Journal of Finance, American Finance Association, vol. 48(4), pages 1349-1378, September.
    3. Grossman, Sanford J & Stiglitz, Joseph E, 1980. "On the Impossibility of Informationally Efficient Markets," American Economic Review, American Economic Association, vol. 70(3), pages 393-408, June.
    4. Dow, James, 1998. "Arbitrage, Hedging, and Financial Innovation," Review of Financial Studies, Society for Financial Studies, vol. 11(4), pages 739-755.
    5. Dow, James & Gorton, Gary, 1997. "Noise Trading, Delegated Portfolio Management, and Economic Welfare," Journal of Political Economy, University of Chicago Press, vol. 105(5), pages 1024-1050, October.
    6. José M. Marín & Rohit Rahi, 2000. "Information Revelation and Market Incompleteness," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 67(3), pages 563-579.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Shino Takayama, 2010. "A dynamic strategy of the informed trader with market manipulation," Annals of Finance, Springer, vol. 6(2), pages 287-294, March.

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    More about this item

    Keywords

    Capital structure choice; Informational leverage; Information revelation; Noise trading; Security design; G32;
    All these keywords.

    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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